Assume the representative consumer lives in two periods and his preferences can be described by U(co, CI) = Co + 0.95 c1 4/9, where e is the current consumption, c, is next period consumption. Let's assume that the consumer can borrow or lend at the interest rate r = 10%. The consumer receives an income yo = 100 in the current period and y1 = 150 in the next period. The government wants to spend Go = 40 in the current period and G1 = 60 in the future period. 1. Solve the consumer's problem by finding the optimal allocation (@, c;). [05 points] 2. What is the equilibrium interest rate r* in this economy? [05 points]